Patrick Mill, CEO

For Professional Advisers only

I think we’d all say it’s been a fairly eventful quarter. This second quarter concluded with a significant milestone: after the two-year battle to get inflation back on target, it finally happened. Attention then turned to the Monetary Policy Committee (MPC) to see how it would respond. Despite June’s labour market data – very much a lag indicator – showing signs of softening, and UK inflation lower than both the Eurozone and US at the time the Committee members met, the MPC nevertheless voted to hold the base rate again. This cautious approach likely reflects the Bank of England’s concern about reigniting inflation. It seems that they’re treading carefully.

And of course, the quarter included the news of the upcoming General Election. As a Labour election win was widely anticipated it had been priced into financial markets – meaning it had minimal immediate impact. However, future market reactions will depend on the new government’s policies. We’ll need to wait and see on that front. We can expect to know more after the State Opening of Parliament on 17 July, where the King’s Speech will highlight the new government’s legislative focuses.

In the meantime, although we’re yet to see the full details of many policies, we’ve had some of the headlines. In the days since their election win, Labour has quickly made several important announcements showing their focus on some of the top challenges facing the country. Here’s just a few:

• Reintroduce housing targets and restart stalled housing projects in key areas – getting ‘Britain building again’
• Boost renewable energy by ending the ban on onshore windfarms and creating a publicly-owned GB Energy company
• ‘Turn our health service around’, including by resolving the junior doctors pay dispute
• Improve education by recruiting an extra 6,500 new teachers
• Address prison overcrowding
• The Rwanda deportation scheme gets scrapped. Plans to boost border security, and clear the backlog of asylum cases

When it comes to financial services and pensions, we’re yet to see anything too concrete. But chancellor Rachel Reeves has:

• Reiterated that Labour would not be increasing national insurance, the basic or higher rates of income tax or VAT
• Suggested that they intend to stick to previous plans to encourage pension schemes to invest in UK equities to drive investment in British business
• Confirmed that she plans to present an assessment of the state of the nation’s spending inheritance to parliament and that she will announce the date of a Budget before parliament’s summer recess

There has been some speculation recently about whether we’ll see a Budget in September or October.  And by that time, I’ll be writing my Q3 quarterly deep dive…

What’s on at Wealthtime?

Looking back at Q2

We continued our Rethinking Retirement roadshows throughout April and May. Thank you to everyone who came to one of the 17 events! We really enjoyed getting out on the road and speaking with you all. If you weren’t able to make it, check out the recorded virtual version now.  We may be looking at doing a further run of roadshows later in the year – so watch this space…

One of the highlights from Q2 in the service teams was a review which re-examined our processes from the client’s perspective. In practice, this meant a realignment of the operational teams to support customer journeys, and taking a fresh look at how we deal with the more delicate elements of our business such as bereavement claims and complaints.

This quarter, we started work on our Pensions Online initiative. It’ll bring you more information, notifications and efficient pension applications. We started by making visible all existing Drip Feed Drawdown instructions – view them under the wrapper details section on the Uncrystallised SIPP.

What to expect in Q3

We continue to look at what changes we can make to bring improvements for you and your clients.

In the service world, one of our key changes will be the introduction of new automation in some of our processes (such as the Secure Lifetime Income process and transfer out confirmations). This will bring greater efficiencies to improve the time it takes to complete these processes.

When it comes to developments, we’re in the early stages of adding an online journey for requesting ad-hoc pension income.

And we’re working on the flexible charging options to bring you tiered charging structures and adviser charge groups. We’re testing it with selected firms at the moment, ahead of plans to roll out the features more widely later in the summer.

Talking of summer, I hope you have an enjoyable and successful Q3, or at least get the chance to get some much needed R&R!

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FT.com Bank of England holds rates at 5.25% in ‘finely balanced’ decision

Inews.co.uk What are Labour’s plans for the UK? All key announcements since winning election

FT.com Reeves includes pensions in series of reforms for growth

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